You can also listen to the interview in the audio version.
The domestic company ZDR Investments, which manages a group of real estate funds, seeks to acquire new sources of capital in Asia. In Singapore, she established a fund that will compete for the favor of local, more mobile investors. And this at a time when the flow of investor money on the Czech market in general is significantly weaker than in previous years.
“Two years ago, we also became interested in the Asian financial markets. And Singapore is the center of finance in Asia. We found out that there is interest in Central European real estate, especially in our most conservative segment, even among investors there, but there is a bit of a barrier to intercontinental investment,” said Roman Latuske, a partner in ZDR Investments, in the Agenda of SZ Byznys.
On the Singapore market, ZDR will try to reach, for example, companies managing the private assets of local businessmen.
“This September, we launched our Singapore feeder fund. This is something like a pool of funds that will allow investors there to participate in our Central European investment strategy, but at the same time they will be able to take advantage of all the local tax and other benefits,” added Latuske.
ZDR Investments does not yet want to speculate on the amount of capital it intends to raise in Singapore. “We have to try it,” remarked the group leader.
Loss of capital
On the Czech market, real estate funds are currently experiencing a significantly weaker inflow of new capital from investors than they were used to in previous years. Higher interest rates are mainly to blame. Thanks to them, a number of investors are satisfied, for example, with leaving money in savings accounts.
“Obviously, we’ve also seen some slowdown in new investor access,” Latuske said. However, I think we are still doing relatively well compared to other funds. “The difference between the inflow and outflow of money is still positive for us,” he added.
The funds are betting that interest rates will not rise any more, and capital will thus begin to return to them.
“We strongly believe that in the first half of next year, the money sitting in the banks today will be drained away and people will again look for opportunities within the various real estate funds,” said Latuske.
“Unplugging” the capital will be key to the further development of the real estate fund business.
“We have completed our acquisition plans for 2024 and 2025. Their implementation will depend only on how the flow of new money can be set up,” added Latuske.
Over 10,000 people have money in ZDR Investments funds. The value of the group’s portfolio exceeds 13 billion crowns.
A number of other real estate funds also operate on the Czech market. Among the funds for qualified, i.e. more experienced and wealthier investors, the Accolade fund focused on industrial real estate is well-known. The Reico fund from the Česká spořitelna group is also active on the market. Other players include, for example, real estate funds managed by the investment group Wood & Company.
The full interview is available in the introductory video.